Chapter Twelve: Module Intro -- Fiscal Policy

Since the Great Depression, the U.S. federal government has taken more responsibility for the state of the business cycle. The government has developed a variety of programs and policies to stabilize economic performance. This chapter examines the government's stabilization role in detail. We focus on the tools of fiscal policy and see how they impact the economy. We also examine supply-side economics and analyze the economy's experience with this theory in the 1980s.

We recommend that you read the lecture notes first, then take the on-line quiz to test your knowledge. Finally, read the module summary to review the main points.